Cattle futures continued to trudge lower on Friday, helped along by apparent technical selling and continued fund liquidation.
Live Cattle futures closed an average of 65¢ lower (7¢ lower toward the back of the board to $1.15 lower in spot Apr).
Feeder Cattle futures closed an average of $1.22 lower (80¢ to $1.47 lower).
Choice boxed beef cutout value was 22¢ higher on Friday afternoon at $222.52/cwt. Select was 96¢ lower at $214.64.
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Major U.S. financial indices closed mixed on Friday. There was follow-through pressure tied to the previous day’s announcement by President Trump’s that the U.S. will levy tariffs on steel and aluminum imports, starting next week.
The Dow Jones Industrial Average closed 70 points lower. The S&P 500 closed 13 points higher. The NASDAQ closed 77 points higher.
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Pressure in deferred Live Cattle futures and the number of cattle already placed against summer months weakened feeder cattle prices last week.
“Moderate to good demand for this large offering, with the best demand seen for cattle suitable for grass,” explained the AMS reporter on hand for Friday’s sale at Herreid Livestock Auction in South Dakota, where about 5,000 head were on offer. “…The volume of finishing type cattle moving right now, coupled with the dismal looking summer futures, when most of these cattle will finish, is making buyers nervous and very choosy about what they send to feed.”
If pen space and lower cash fed cattle prices explain last week’s softer feeder cattle demand, then the decline might be short lived, says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments.
“However, if the price decline is due to a larger underlying issue, such as in-creased beef production and no further increases in beef demand, then softer prices may persist,” Griffith says.